Land shortage hampers housing scheme

The government’s 500,000-unit national housing scheme is being hampered by a shortage of suitable land close to cities and utilities, an informed source said yesterday.
Only one-third of the land is available for the Ministry of Housing project approved by Custodian of the Two Holy Mosques King Abdullah, but these plots are far from urban areas and basic services, the source said.
The problem is particularly pronounced in Riyadh, Jeddah, Taif and Abha, the source said.
“Since most of the land available for the project is away from main cities, the government will have to spend a huge amount to bring utilities to the projects. Besides, those locations might not please the beneficiaries because of the distance from cities. The ministry is working with provincial governorates and municipalities to find a solution to the issue,” the source said.
He said the ministry has asked the Ministry of Municipal and Rural Affairs to improve the land grant scheme and consolidate regulations for the land grant, house building and Real Estate Development Fund loans under a single system. This would ensure a citizen can get a plot and loan simultaneously and can start construction; or buy a completed housing unit without delay.
The source added that some of the contractors appointed for the housing project, despite their superior rating in the construction sector, are incapable of implementing their contracts.
The source said project delays are caused by inefficient contractors who do not have the resources to speed up their work and meet the deadlines specified in their contracts. Some contractors are also incapable of handling issues such as price fluctuations for building materials, resulting in further delays, the source said.
Abdullah Al-Ahmari, chairman of the real estate valuation and auctions committee at the Jeddah Chamber of Commerce and Industry, said the housing problem cannot be solved easily and that it needs major effort rather than studies and research.
“The Ministry of Housing and Ministry of Municipal and Rural Affairs are still conducting studies to determine the perfect designs and companies to develop residential units. We have to admit that the Ministry of Housing is working hard, but they face challenges because of bureaucratic delays,” he said.
“The housing ministry usually gets land in far-off areas that are not developed and ready for housing projects, which is why the ministry has to develop the infrastructure with the electricity and water companies. Providing these services for the projects takes a long time.”
Al-Ahmari said the housing ministry needs a special company to oversee its projects, just like companies operating the municipality’s projects. “Such a company will stop the bureaucratic delays that the housing ministry is suffering from,” he said.